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Re: Don't forget the tax break on a trade-in...but (archive)

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Posted by ptdaniel on April 28, 2000 at 10:14:48:

In Reply to: Don't forget the tax break on a trade-in posted by Jim Scott on April 28, 2000 at 07:06:56:

: Not sure if every state does this but here in Louisiana you get a tax break on the value of the trade-in.

: Example: You get $30,000 for your trade. The new or used vehicle you purchase costs $40,000. You only pay state sales tax on $10,000. With 9.5% sales tax trading your car for $30,000 would save you $2,850 dollars in sales tax.

Missouri is the same but with an added bonus: even if you sell privately, as long is it within 30 days (before *or* after) of buying a car they will still tax you only on the net of the transactions. (In the case of selling *after* getting another car you have to file for a refund of the excess tax you paid). In other words, check with your local DMV.

P.S. - but when you think about it, why are we letting states/cities tax us on used cars -- which were taxed on their *full* value at the time of original sale (as new)? Taxpayers unite!

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